That's what Bernard Arnault, president and chief executive of LVMH, said in presenting the quarterly and annual results of his group, adding his confidence in another set of positive figures for 2012. He also insisted that he had no intention of taking the control of Hermès, a company in which the group held a 22.28 percent stake at the end of 2011, but he declared himself open to cooperation in terms of synergies and know-how.
Like LVMH, Hermès has performed better than expected lately. Beating analysts' estimates, the company said in a preliminary report that its sales grew by 15.8 percent to €852.5 million in the fourth quarter of 2011, driven by strong demand in Asia and Europe. For the full year, Hermès' revenues surged by 18.3 percent, and its operating margin reached a level estimated at more than 30 percent, compared with 27.8 percent in 2010. More detailed figures will be given on March 22.
LVMH reached a turnover of €23.7 billion in 2011, scoring a 14 percent sales increase on a currency-neutral basis. There was only a small dip to 12 percent in the year-on-year growth for the fourth quarter, down from 15 percent in the third quarter, but this was partly due to a distribution change in Russia.
Higher raw material costs did not prevent LVMH from raising its operating income by 22 percent last year to €5.26 billion. Its net income rose by only 1 percent to €3.06 billion, but it was up by 37 percent excluding the extraordinary capital gains obtained in 2010 on the group's investment in Hermès.
LVMH's fashion and leathergoods division improved its operating profit by 20 percent to some €3 billion on 15 percent higher sales of €8.71 billion. As usual, Louis Vuitton contributed to this strong performance with a turnover estimated by analysts between €5 billion and €6 billion. Progress was also recorded for Berluti, Fendi, Céline, Givenchy and Loewe.
Geographically, the global turnover of the group increased by less than 7 percent in Europe, with a small increase even in Spain, thanks in part to purchases by foreign tourists. Group sales increased by 18 percent in the U.S. and by 27 percent in Asia. While they jumped by 28 percent in China, they dropped by 1 percent in Japan under the effect of the earthquake and tsunami of last March.
The good results of the French company enabled Christian Dior Group, which owns 42.4 percent of LVMH, to report a similar increase in its net income to €1.28 billion on 17 percent higher consolidated revenues of €24.6 billion. The spectacular dismissal of John Galliano as chief designer of Christian Dior Couture last March did not prevent the Dior fashion brand from recording a 21 percent increase in total sales, passing for the first time the threshold of €1 billion.
Dior's sales were driven by its fragrances, its handbags and other accessories. Its retail sales went up by 27 percent. The operating profit more than doubled to €85 million.